Income & Wealth Inequality

Note: I hope most of this has already become part of our collective consciousness. In the time between Occupy Wall St. then and Bernie Sanders now, I’m hoping that most of these ideas aren’t new to many.

The study of the political economy highlights the distribution of wealth in the US in ways that the majority of the population would rather ignore. The phrase ‘welfare state’ tends to evoke ideas involving the distribution of tax money to public assistance programs. Particularly, programs like FDAC and food stamps, rather than any of the widespread middle class, upper class, and corporate benefits are suggested. This is, in part, due to the dominant ideology that tends to view “successful” individuals or businesses as living the American Dream. The idea that they can be dependent on public funds is incompatible with this view, and rarely included in any formal socialization.

The American Dream itself is sometimes at odds with itself, as it exists in a Capitalist Democratic framework. In order to see the tug-of-war between liberty and equality, one must employ critical thinking. But how often do we critically analyze concepts which we consider second-nature? Essentially, one must favor one over the other because liberty and equality tend to compete for government resources.

* See the Noam Chomsky documentary on Netflix called ‘Requiem for the American Dream’, for more about the push and pull between inequality & democracy. Pretty concise and informative!

Although many Americans accept that taxes are a necessary burden, the public rarely looks in depth at tax codes and public expenditures, given that our public servants are entrusted to make these decisions using their expertise, with our best interests in mind. As an example, the City of Detroit provided Marathon Oil Company a 175 million dollar personal property tax reduction in order to expand its operations in the city. Although the idea behind this tax break (as the public was led to believe) was to create more jobs for inhabitants of the city, the deal resulted in a net gain of only 15 jobs for Detroit residents. This is one of the countless examples of the political influence held by large corporations. Sadly, although not the sole reason, this added to the economic troubles that sent the City of Detroit to bankruptcy. In addition to the economic impact, Detroit residents also are now faced with the environmental consequences of the refinery’s expansion. (Update: For now, let me resist the urge to add more on the problems [e.g., Flint water crisis] that have arisen since the time of this essay).

By focusing on public assistance fraud as the greatest public enemy, little attention is paid to more egregious crimes committed by corporations and the wealthy. After the economic crisis on Wall Street crippled our economy, the banks have managed to keep their top CEOs and bankers from being arrested, while nearly 8,000 Americans were arrested in association with the Occupy Wall Street movement. Meanwhile, there have been only a handful of politicians that have called attention to this type of inequality. They have kept quiet, in part, by their willingness to accept millions from these corporations in campaign contributions, bolstered by the 2008 ruling made by the Supreme Court in Citizens United v. Federal Election Commission. This ruling has set the stage for a future where inequality will only continue to rise. Liberty too will suffer, when the majority are unable to pursue their own self-interest because their voices will have been muted by an extremely powerful elite.

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